Apple (NASDAQ: AAPL) announced its new iCloud multimedia storage system and a new version of its OS called Lion. Nothing was said about updated versions of the iPad or iPhone at Apple’s World Wide Developer Conference 2011. That should concern investors and cheer Apple’s competition.
Apple does not have any visible plans to offer 4G-enabled devices either for the LTE standard used by AT&T Wireless and Verizon Wireless or the WiMax system used by Sprint-Nextel (NYSE: S). Each of these companies plans to have 4G coverage in all major US cities by the end of this year. There are very few numbers available about early adoption.
Apple’s’ major competitors have begun to aggressively release 4G models. The largest number of these are from Taiwan smartphone firm HTC. HTC’s revenue growth is above 100% year-over-year now, a pace that no other firm in the sector can match. It will be probably be larger than Motorola and Research In Motion (NASDAQ: RIMM) in 2012 measured by revenue and handsets shipped. HTC has hitched its wagon to the popular Google (NASDAQ: GOOG) Android system and is one of the reasons the OS has grown so quickly. Motorola has also decided that 4G enabled devices will boost help sales. There are rumors Dell (NASDAQ: DELL) will launch a 4G enabled tablet next quarter.
Apple have been able to force the market to come to it since the iPod became a success a decade ago. The iPhone and iPad are proof that the demand for Apple’s hardware is nearly limitless because of its uncanny ability to predict consumer demand. It has also tethered users to its products by the creation of the remarkably successful App Store with its hundreds of thousands of products and billions of downloads.
Skeptics about Apple’s future believe that eventually it will be overtaken by not one company, but a pack of several. These firms will sell good tablets at low prices. Or, they will use Android to produce good smartphones to flank the iPhone will better features. The Android app store has grown enough that it is viable competition to Apple’s
Apple professes to be unconcerned about Android. Perhaps it is right. Android phones have been a success because so many handset companies use the software, but no one of these firms has been able to match iPhone sales.
Apple has decided that the iPhone and iPad should remain 3G based products. Apple can wait until 4G customer penetration is high and then release new products that use the ultra-fast wireless systems. As usual, consumers will abandon whatever plans they had to own competing 4G devices and flood into Apple stores and those of its carriers. HTC and other smartphone companies, which have already launched 4G smartphones, may prove that they were adroit enough and good enough product engineers that Apple will for once find that it mistimed the markets
Douglas A. McIntyre
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